Personal Taxation (Hansard, 26 January 1977)

§ Mr. Ralph Howell
asked the Chancellor of the Exchequer if he will publish a table showing how much income tax will be paid in 1976–77, assuming earnings of 641W £2,000, £3,000, £4,000 and £5,000 in each of the following circumstances: (a) two single adults sharing accommodation, (b) a married couple with no children, wife earning, (c) a married couple with no children, wife not earning, (d) married

(a) (b) (c) (d) (e)

Annual earnings Two single adults Married couple with no children, wife earning Married couple with no children, wife not earning Married couple with one child, wife not earning Married couple with two children, wife not earning

£ £ £ £ £ £

2,000 … … … 185.50 63.00 320.25 215.25 155.75

3,000 … … … 535.50 413.00 670.00 565.25 505.75

4,000 … … … 885.50 763.00 1,020.25 915.25 855.75

5,000 … … … 1,235.50 1,113.00 1,370.25 1,265.25 1,205.75

Notes:

(1) It is assumed that each single adult and the working wife, earns at least £735 a year and that the children are not over 11 years old.

(2) The figures in the final column take account of the effects of Family Allowance and "clawback", and it has been assumed that Family Allowance is received in addition to the annual earnings shown.

§ Mr. Ralph Howell
asked the Chancellor of the Exchequer if he will bring up to date the tables published on 16th December 1975, Official Report, columns 558–60, in reply to the hon. Member for North Norfolk, comparing total income tax and national insurance liability for

1975–76 1976–77

Gross Wage Amount £ Amount as percentage of earnings per cent. Amount £ Amount as percentage of earnings per cent.

50 per cent of average weekly earnings—

Weekly earnings … … … … 27.79 33.30

Income tax … … … … 1.64 5.5 1.19 3.6

Employer's NIC … … … … 2.53 8.5 2.91 8.8

Employee's NIC … … … … 1.64 5.5 1.91 5.8

75 per cent of average weekly earnings—

Weekly earnings … … … … 44.69 49.95

Income tax … … … … 6.86 15.4 7.02 14.1

Employer's NIC … … … … 3.80 8.5 4.37 8.8

Employee's NIC … … … … 2.46 5.5 2.87 5.8

100 per cent, of average weekly earnings—

Weekly earnings … … … … 59.58 66.60

Income tax … … … … 12.07 20.3 12.84 19.3

Employer's NIC … … … … 5.06 8.5 5.83 8.8

Employee's NIC … … … … 3.28 5.5 3.83 5.8

150 per cent of average weekly earnings—

Weekly earnings … … … … 89.37 99.90

Income tax … … … … 22.50 25.2 24.50 24.5

Employer's NIC … … … … 5.86 6.6 8.31 8.3

Employee's NIC … … … … 3.79 4.2 5.46 5.5

200 per cent, of average weekly earnings—

Weekly earnings … … … … 119.16 133.20

Income tax … … … … 33.30 27.9 36.51 27.4

Employer's NIC … … … … 5.86 4.9 8.31 6.2

Employee's NIC … … … … 3.79 3.2 5.46 4.1

The figures have been calculated on the same basis as before. The revised 1975–76 figures are based on the average weekly earnings at October 1975 of full-time manual male workers aged 21 and over; for 1976–77 this figure has been updated to August 1976 by applying the monthly index of average earnings.

§ Mr. Ralph Howell
asked the Chancellor of the Exchequer if he will compare,
642W
couple with one child, wife not earning, and (e) married couple with two children, wife not earning.

§ Mr. Robert Sheldon
The amounts of income tax payable in 1976–77 are as follows:
a married man with two children in 1950–51 and in 1976–77, as a percentage of different levels of earnings.

§ Mr. Robert Sheldon
The revised figures for 1975–76 and 1976–77 are as follows:
at current prices and at 1939 prices, the value of married, single, wife's earned 643W income and child tax allowances, in 1939–40, 1946–47 and 1976–77.

1939–40 1946–47 1976–77

Value at current prices Value at current prices Value at 1939 prices Value at current prices Value at 1939 prices

£ £ £ £ £

Married person's allowance 225 209 125 1,085 122

single person's allowance 125 129 77 735 82

Wife's earned income allowance 56 129 77 735 82

Child allowance:

child not over 11 75 57 34 300 (248) 34 (28)

child over 11 but not over 16 75 57 34 335 (283) 38 (32)

child over 16 75 57 34 365 (313) 41 (35)

The figures for 1939–40 and 1946–47 take account where appropriate of the relief given for National Insurance contributions and of earned income relief. The figures in brackets for 1976–77 show the value of child allowances after the Family Allowance deduction ("clawback").

The price index used for 1976–77 is the average general index of retail prices—all items—for the calendar year 1976. For earlier years, the figures relate to the calendar years 1939 and 1946 and are taken from Table 2 of "The Internal Purchasing Power of the Pound", published by the Central Statistical Office.

§ Dr. McDonald
asked the Chancellor of the Exchequer what are the 1977–78 estimated costs of (a) single personal allowance, (b) married personal allowance, (c) children allowance, under 11 years of age, (d) children allowance, 11 to 16 years of age, (e) children allowance over 16 years of age, (f) additional personal allowance, (g) additional personal relief, (h) housekeeping allowance, and (i) age allowance, indicating wherever applicable, the amount expected to be claimed at higher rates of taxation; and if he will publish these costs in the Official Report.

§ Mr. Robert Sheldon
I will let my hon. Friend have a reply as soon as possible.

§ Dr. McDonald
asked the Chancellor of the Exchequer what would be the saving to the Exchequer if the following reliefs were paid only at the standard rate for 1977–78: (a) mortgage interest relief, (b) bank loan interest, for house purchase and for other purposes, (c) superannuation and retirement pension, on employee contributions and on employer contributions, (d) relief for provision of medical insurance claimed by firms, and (e) fees to professional bodies and work expenses; and if he will publish the figures in the Official Report.

§ Mr. Robert Sheldon
I will let my hon. Friend have a reply as soon as possible.

				(a)	(b)	(c)	(d)	(e)
Annual earnings	Two single adults	Married couple with no children, wife earning	Married couple with no children, wife not earning	Married couple with one child, wife not earning	Married couple with two children, wife not earning
£				£	£	£	£	£
2,000	…	…	…	185.50	63.00	320.25	215.25	155.75
3,000	…	…	…	535.50	413.00	670.00	565.25	505.75
4,000	…	…	…	885.50	763.00	1,020.25	915.25	855.75
5,000	…	…	…	1,235.50	1,113.00	1,370.25	1,265.25	1,205.75
Notes:
(1) It is assumed that each single adult and the working wife, earns at least £735 a year and that the children are not over 11 years old.
(2) The figures in the final column take account of the effects of Family Allowance and "clawback", and it has been assumed that Family Allowance is received in addition to the annual earnings shown.

					1975–76	1976–77
Gross Wage	Amount £	Amount as percentage of earnings per cent.	Amount £	Amount as percentage of earnings per cent.
50 per cent of average weekly earnings—
Weekly earnings	…	…	…	…	27.79		33.30
Income tax	…	…	…	…	1.64	5.5	1.19	3.6
Employer's NIC	…	…	…	…	2.53	8.5	2.91	8.8
Employee's NIC	…	…	…	…	1.64	5.5	1.91	5.8
75 per cent of average weekly earnings—
Weekly earnings	…	…	…	…	44.69		49.95
Income tax	…	…	…	…	6.86	15.4	7.02	14.1
Employer's NIC	…	…	…	…	3.80	8.5	4.37	8.8
Employee's NIC	…	…	…	…	2.46	5.5	2.87	5.8
100 per cent, of average weekly earnings—
Weekly earnings	…	…	…	…	59.58		66.60
Income tax	…	…	…	…	12.07	20.3	12.84	19.3
Employer's NIC	…	…	…	…	5.06	8.5	5.83	8.8
Employee's NIC	…	…	…	…	3.28	5.5	3.83	5.8
150 per cent of average weekly earnings—
Weekly earnings	…	…	…	…	89.37		99.90
Income tax	…	…	…	…	22.50	25.2	24.50	24.5
Employer's NIC	…	…	…	…	5.86	6.6	8.31	8.3
Employee's NIC	…	…	…	…	3.79	4.2	5.46	5.5
200 per cent, of average weekly earnings—
Weekly earnings	…	…	…	…	119.16		133.20
Income tax	…	…	…	…	33.30	27.9	36.51	27.4
Employer's NIC	…	…	…	…	5.86	4.9	8.31	6.2
Employee's NIC	…	…	…	…	3.79	3.2	5.46	4.1
The figures have been calculated on the same basis as before. The revised 1975–76 figures are based on the average weekly earnings at October 1975 of full-time manual male workers aged 21 and over; for 1976–77 this figure has been updated to August 1976 by applying the monthly index of average earnings.

	1939–40	1946–47	1976–77
	Value at current prices	Value at current prices	Value at 1939 prices	Value at current prices	Value at 1939 prices
	£	£	£	£	£
Married person's allowance	225	209	125	1,085	122
single person's allowance	125	129	77	735	82
Wife's earned income allowance	56	129	77	735	82
Child allowance:
child not over 11	75	57	34	300 (248)	34 (28)
child over 11 but not over 16	75	57	34	335 (283)	38 (32)
child over 16	75	57	34	365 (313)	41 (35)
The figures for 1939–40 and 1946–47 take account where appropriate of the relief given for National Insurance contributions and of earned income relief. The figures in brackets for 1976–77 show the value of child allowances after the Family Allowance deduction ("clawback").
The price index used for 1976–77 is the average general index of retail prices—all items—for the calendar year 1976. For earlier years, the figures relate to the calendar years 1939 and 1946 and are taken from Table 2 of "The Internal Purchasing Power of the Pound", published by the Central Statistical Office.